First Principles Thinking in Companies

There has been an outcry of “First Principles Thinking” lately, probably due to people writing about Elon Musk or Richard Feynman.

Both are/were huge proponents. But what the hell is it? It’s the idea that we have built into our thinking processes crutches or shortcuts that we lean on that may be faulty. Musk when thinking about rockets at the founding of SpaceX thought why do we throw out the used rockets? Decades ago the technology to try and land a booster rocket simply didn’t exist, so NASA let them fall into the ocean. By testing that assumption Musk realized that he could reuse those boosters, again and again, that would reduce cost, allow him to take on more launches – without having to rebuild from zero after every launch – and get to market more quickly. The more signed launches, the more cash to build the technology and so on and so forth. He is currently doing the same with “The Boring Company,” the first principle he’s fighting there is the speed of the drill. If he can increase the drilling speed 50% (he’s aiming for 5-10X of course) it could revolutionize the industry.

Feynman, working a few decades before Musk, did this with Quantum Physics; he would routinely go back to foundational principles test them and evolve from there to devise a new way of thinking.

The point is, things have changed so much so quickly that we need to re-think some of the assumptions that we take for granted.

Over the course of a few follow-up posts I’m going to rethink organizational precepts from first principles.

Here’s a couple of ideas:

Profits

Revenue

Costs

Markets & Customers

Organization Design

If you would like to see others, reach out, happy to share our thoughts.